Galaxy S4 Costs $244 To Manufacture: IHS

Galaxy S4 Costs $244 To Manufacture: IHS
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Samsung Electronics Co., Ltd. (LON:BC94) (KRX:005930) spent an additional 15 percent to boost the features of the HSPA+ version of its new Samsung Galaxy S4 based on the virtual teardown conducted by researchers at IHS Inc. (NYSE:IHS).

Galaxy S4 Costs $244 To Manufacture: IHS

According to the researchers, the South Korean electronics manufacturers did a major upgrade in the display, sensor, application processor and supporting memory of the Samsung Galaxy 4, which increased the bill of materials of the smartphone to $236. If the company adds up, the $8.50 manufacturing cost, the total BOM of the HSPA+ version of the Samsung Galaxy S4 with 16-gigabyte NAND flash memory is $244.

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In comparison with the BOM of the Galaxy S III, the cost of the Samsung Galaxy S4 is higher by $30.40. The researchers emphasized that virtual tear down of the pricing estimate for the Samsung Galaxy S4 was based from the information and device specification released by Samsung Electronics Co., Ltd. (LON:BC94) (KRX:005930). They also used information derived from known components and suppliers.

According to IHS, the BOM estimate for the Samsung Galaxy S4 could change depending on the physical teardown of the mobile device.

“Although its hardware is not radically different from the Galaxy S III introduced in April of 2012, the Samsung Galaxy S4 includes some critical component updates that enhance its functionality as well as its BOM cost. Among the upgrades are a larger, full high-definition (HD) display; a beefed-up Samsung processor; and a wealth of new sensors that set a record high for the number of such devices in a smartphone design. And despite the larger display and other changes, the Galaxy S4 has roughly the same width and the same ease of handling as the Galaxy S III,” said Vincent Leung, senior analyst for cost benchmark at IHS.

The Samsung Galaxy S4 is integrated with a full HD active-matrix organic light-emitting diode (AMOLED) with 1,920X1,080 pixel, which has an estimated cost of $75. According to Vinta Jakhanwal, director of small & medium displays at HIS, the resolution of the full HD-display of the Galaxy S4 is the first of its kind that was released in the market.

“Reaching a true pixel density greater than 300 ppi has been a challenge for AMOLED display makers. However, Samsung was able to enhance AMOLED display performance by implementing new technologies that also drove up the cost of the display,” said Jakhanwal.

The apps processor of the HSPA+version of the Samsung Galaxy S4 is integrated with the Exynos 5 Octa solution, an eight core chip manufactures by Samsung Electronics Co., Ltd. (LON:BC94) (KRX:005930) using its 28-nanometer technology. The cost of the apps processor is approximately $30. The 4G LTE version of the Galaxy S4 uses the Snapdragon 600, a quad-core apps processor and LTE radio solution from QUALCOMM, Inc. (NASDAQ:QCOM).

Meanwhile the sensors of the Samsung Galaxy S4 can adapt and detect the lifestyle of users. The smartphone is integrated with different sensors including  the accelerometer, RGB light, geomagnetic, proximity, gyroscope, barometer, IR gesture and even temperature and humidity varieties. The estimated cost of the sensors is around $16.

The researchers believed that the supplier of the baseband processor and RF transceiver of the Samsung Galaxy S4 is Intel Corporation (NASDAQ:INTC) while the supplier for the Wireless LAN/LAN/Bluetooth/FM/GPS subsystem and the GPS/GLONASS section is Broadcom Corporation (NASDAQ:BRCM).

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